One Case Against Wal-Mart

(page 2 of 2)

Pizza and Popsicles

But in 2003, Haddad complained about not receiving the same level of bonuses and pay as other pharmacy managers, who were male. She says she had agreed to serve as a pharmacy manager on a temporary basis, but ended up staying in the position for 13 months. Haddad eventually received her bonuses in two installments. Wal-Mart says that because Haddad was not officially a pharmacy manager, she was not entitled to the extra $1 per hour that such managers receive.

It was in April, 2004, that Haddad was terminated and escorted from her Wal-Mart store. According to trial materials, Haddad was dismissed for "failure to secure the pharmacy, leaving a technician alone in the pharmacy." Haddad says the statement refers to a technician's theft of a medicine for treating ulcers, called Prevacid, that took place while she was on duty 18 months before.

Haddad was devastated by the circumstances of her firing. She felt that being accused of involvement with drug theft would damage her reputation as a pharmacist and hurt her ability to get another job. She says that she refused to leave her house alone for six months. The accusation is the key reason she charged Wal-Mart with defamation. "It destroyed a lot of relationships," Haddad says. "You know how you say 'pizza' in the beginning and it comes out 'popsicles'? That's what happened to me."

Expert Testimony

In June of this year, Haddad got her day in court. To counter Wal-Mart's claim that Haddad was fired for failing to secure the pharmacy, attorneys Belfort and Fradette had tracked down male pharmacists from the store who had also been on duty when thefts occurred. Pharmacist Richard Blackbird, who replaced Haddad as pharmacy manager and has since left Wal-Mart, said he was never disciplined for a technician's theft of Vicodin that took place under his watch. He also said the technician left voluntarily rather than being fired.

In a sworn affidavit, Blackbird blamed thefts in the pharmacy on instability caused by the high turnover of district managers, "a circumstance that contributed to creating an environment that enabled the pharmacy technicians to steal and forge prescriptions."

To bolster their case, Haddad's attorneys called Harold Sparr, a pharmacist for 52 years and former president of the Massachusetts Board of Registration in Pharmacy, to testify. "This is not unusual for this to happen," Sparr tells BusinessWeek about drug thefts at pharmacies. "Massachusetts regulation allows the technician to remain in the pharmacy when the pharmacist is gone. Any technician, I don't care where it is in the country, can steal medicine if their incentive is to do that."

Julie Moore, a human resources expert who studied Wal-Mart's Pharmacy Operations Manual, testified that the company failed to communicate and enforce its policies equally or update employees on policy changes.

Fradette and Belfort also called in economics and psychology experts and pointed to Haddad's performance evaluations, in which several supervisors praised her as "a huge asset to the department" and "a very reliable pharmacist" who has "done a great job keeping the department together," according to trial exhibits.

Breaking the Chain

Wal-Mart, in its response, took issue with a number of the claims by Haddad's lawyers. The company, in court filings, denied that Haddad received "excellent reviews throughout her employment." It also denied that the termination had anything to do with Haddad's complaints, and stuck to its contention that Haddad was terminated for violating company policy by leaving a technician alone in the pharmacy.

"We are an equal opportunity employer," says Simley. "We have strict policies against discrimination. We promote diversity at all ranks and at every level."

If the ruling stands, Haddad will be entitled to $1 million in punitive damages, $95,000 in back pay, $733,307 in front pay, and $125,000 for emotional distress. The jury found Wal-Mart guilty of defamation, but did not award Haddad any money for that charge. Separately, her attorneys plan to seek legal fees from Wal-Mart.

Haddad says she brought the case to clear her name, rather than for the money. "The hard part is I have four children and each one of them has children in their class whose parents are pharmacists," says Haddad. "Now I'm just getting phone calls from people who haven't spoken to me."

Haddad, whose husband is also a pharmacist, now works at the independent Lenox Village Integrative Pharmacy in Lenox, Mass. "Kind of leery of chains," she explains with a smile.

Click here to see a slide show about the trial.

Keller is a reporter for BusinessWeek.com in New York.